HIGH inflation could force Coventry and Warwickshire’s hospitals to save even more money, a regulator warned.

Last month the Telegraph reported that University Hospital, Warwick Hospital, St Cross and the George Eliot were being ordered to save £40 million between them over the next 12 months.

Much of that consists of the annual four per cent efficiency savings sought by this government and the last. But Monitor, which oversees hospitals as they become foundation trusts, fears most hospitals will actually have to save up to seven per cent.

That is to meet the rising cost of drugs and medical equipment. NHS budgets are currently rising broadly in line with inflation, but so-called medical inflation is actually far greater.

Monitor warned: “It is essential that the quality of patient services does not suffer as a result of cost-cutting measures.

But the Department of Health said the NHS was in a strong financial position and the warning was based on Monitor’s most “pessimistic” scenario.